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CAUSE NO. 06-1018
IN THE SUPREME COURT OF TEXAS

D.R. HORTON-TEXAS, LTD.,
Petitioner

MARKEL INTERNATIONAL INSURANCE COMPANY, LTD.,
Respondent

ON PETITION FOR REVIEW

BRIEF OF AMICUS CURIAE ASSOCIATED GENERAL CONTRACTORS OF
AMERICA – TEXAS BUILDING BRANCH
IN SUPPORT OF PETITIONER D.R. HORTON-TEXAS, LTD.

Lee H. Shidlofsky Corbin Van Arsdale
Texas Bar No. 24002937 Texas Bar No. 00794776
Douglas P. Skelley AGC-TEXAS BUILDING BRANCH
Texas Bar No. 24056335 816 Congress Ave., Suite 950
VISSER SHIDLOFSKY LLP Austin, Texas 78701
7200 N. Mopac Expy., Ste. 430 (512) 478-5629
Austin, Texas 78731 (512) 478-1618 (fax)
(512) 795-0613
(866) 232-8709 (fax)

ATTORNEYS FOR AMICUS CURIAE
ASSOCIATED GENERAL CONTRACTORS OF AMERICA –
TEXAS BUILDING BRANCH
IDENTITY OF THE PARTIES, AMICUS CURIAE AND THEIR COUNSEL

Petitioner: Attorneys:

D.R. Horton-Texas, Ltd. Blake S. Evans
Stephen W. Burnett
SCHUBERT & EVANS, P.C.
900 Jackson St., Suite 630
Dallas, Texas 75202

Robert B. Gilbreath
HAWKINS, PARNELL & THACKSTON,
LLP
Highland Park Place
4514 Cole Ave., Suite 500
Dallas, Texas 75205

Maurice Bresenhan, Jr.
Pascal Paul Piazza
ZUKOWSKI BRESENHAM & SINEX, LLP
1177 West Loop South, Suite 1100
Houston, Texas 77027

Respondent: Attorneys:

Markel International Insurance Company, Ltd. Les Pickett
James M. Tompkins
James T. Bailey
GALLOWAY, JOHNSON, TOMPKINS,
BURR & SMITH
1301 McKinney, Suite 1400
Houston, Texas 77010

Interested Party: Attorneys:

Sphere Drake Insurance, Ltd. Robert A. Shults
Jacob De Leon
MCFALL, SHERWOOD & BREITBEIL
1331 Lamar, Suite 1250
Four Houston Center
Houston, Texas 77010

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Amicus Curiae: Attorneys:

Texas Association of Builders Lee H. Shidlofsky
National Association of Home Builders and Douglas P. Skelley
Associated General Contractors of America - VISSER SHIDLOFSKY LLP
Texas Building Branch 7200 N. Mopac Expy., Suite 430
Austin, Texas 78731

M. Scott Norman, Jr.
Texas Association of Builders
313 East 12th Street, Suite 210
Austin, Texas 78701

David S. Jaffe
National Association of Home Builders
1201 15th Street, N.W.
Washington, D.C. 20005

Corbin Van Arsdale
Associated General Contractors of
America – Texas Building Branch
816 Congress Ave., Suite 950
Austin, Texas 78701

ii
TABLE OF CONTENTS

TABLE OF AUTHORITIES ...................................................................................................... iv

INTRODUCTION......................................................................................................................... 1

STATEMENT OF INTEREST.................................................................................................... 1

STATEMENT OF THE CASE.................................................................................................... 2

STATEMENT OF JURISDICTION........................................................................................... 2

STATEMENT OF FACTS........................................................................................................... 3

ARGUMENT & AUTHORITIES ............................................................................................... 3

PRAYER........................................................................................................................................ 4

CERTIFICATE OF SERVICE ................................................................................................... 5

iii
TABLE OF AUTHORITIES

Cases
Mary Kay Holding Corp. v. Federal Insurance Co.,
309 F. App’x 843 (5th Cir. 2009) ............................................................................................. 3
National Union Fire Insurance Co. v. Crocker,
246 S.W.3d 603 (Tex. 2008)..................................................................................................... 4
Northfield Insurance Co. v. Loving Home Care, Inc.,
363 F.3d 523 (5th Cir. 2004) .................................................................................................... 3
Ooida Risk Retention Group, Inc. v. Williams,
2009 WL 2461850 (5th Cir. Aug. 12, 2009)............................................................................. 3

Rules
TEX. R. APP. P. 11........................................................................................................................... 4

iv
INTRODUCTION

Associated General Contractors of America – Texas Building Branch (“AGC-

TBB”), pursuant to TEX. R. APP. P. 11, respectfully submits this brief as amicus curiae in

support of the Petition for Review and Motion for Rehearing filed by Petitioner D.R.

Horton–Texas, Ltd. (“D.R. Horton”). AGC-TBB represents the State of Texas’ general

contractors. AGC-TBB urges this Court to find that, at the very least, the Fourteenth

District Court of Appeals erred by conflating the “duty to defend” with the “duty to

indemnify” when it held that because D.R. Horton could not introduce extrinsic evidence

to establish the duty to defend, as a matter of law, it also could not establish a duty to

indemnify. The court of appeals’ holding on that issue effectively deprives D.R. Horton

of the additional insured status for which it contracted with its subcontractor based on the

incomplete allegations pled by the third-party claimant. And, even if an “eight corners”

approach is taken whereby no extrinsic evidence is admitted at the duty to defend stage,

the same standard should not be applied to the duty to indemnify, as it is well-recognized

that the duties are separate and distinct.

STATEMENT OF INTEREST

The AGC-TBB is a branch of the Associated General Contractors of America

(“AGCA”). The AGCA is the oldest and largest nationwide association representing

construction contractors. AGCA was formed in 1918 and it represents more than 32,000

firms in nearly 100 chapters throughout the United States. The AGC-TBB is comprised

of twelve AGCA building chapters located throughout the State of Texas. The

1
membership of these twelve chapters consists of approximately 370 general contractors

and 3,890 specialty contractors, subcontractors and suppliers, all doing business in Texas.

Because of its unique perspective as an influential representative of a broad segment of

the construction industry, this organization has submitted amicus curiae briefs in

numerous jurisdictions across Texas. Moreover, it has a great interest in the many risks

that are inherent in the construction process, and insurance has long played an important

role for its members in managing those risks. Whether members of the AGC-TBB can

depend on their additional insured status under commercial general liability (“CGL”)

insurance policies to provide some reasonable degree of protection against financial harm

is a matter of continuing and urgent interest to the members of this organization.

Consequently, though it is not a party to this appeal, this brief is filed by the AGC-TBB

as amicus curiae through the undersigned independent counsel, who was not paid a fee by

the AGC-TBB for its preparation.

STATEMENT OF THE CASE

AGC-TBB adopts the Statement of the Case in the Petitioner’s Petition for

Review.

STATEMENT OF JURISDICTION

AGC-TBB adopts the Statement of Jurisdiction in the Petitioner’s Petition for

Review.

ISSUES PRESENTED

AGC-TBB adopts the Issues Presented in the Petitioner’s Petition for Review.

2
STATEMENT OF FACTS

AGC-TBB adopts the Statement of Facts in the Petitioner’s Petition for Review.

ARGUMENT & AUTHORITIES

AGC-TBB adopts, in their entirety, the arguments and authorities presented by the

Texas Association of Builders and the National Association of Home Builders in their

two amici curiae briefs already on file with this Court. Those briefs were filed in support

of D.R. Horton-Texas, Ltd.’s Petition for Review and its subsequent Motion for

Rehearing.

A need exists to clarify whether Texas recognizes any exception to the “eight

corners” rule. Simply put, confusion remains prevalent among Texas courts. Compare,

e.g., Ooida Risk Retention Group, Inc. v. Williams, 2009 WL 2461850 (5th Cir. Aug. 12,

2009) (finding that an exception to the “eight corners” rule existed through the Fifth

Circuit’s “Erie guess” in Northfield Ins. Co. v. Loving Home Care, Inc., 363 F.3d 523,

531 (5th Cir. 2004)), with Mary Kay Holding Corp. v. Federal Ins. Co., 309 F. App’x 843

(5th Cir. 2009) (finding that Texas has yet to adopt an exception to the “eight corners”

rule). This continued confusion as to Texas’ standing on the existence of any exception to

the “eight corners” rule needs to be clarified. And, if this Court were to permit a limited

and narrow exception to the “eight corners” rule for “coverage-only” facts that do not

overlap or in any way contradict the allegations in the underlying lawsuit, AGC-TBB

respectfully submits that this is the “poster child” case for recognition of such an

exception.

3
Even if this Court does not agree that any exception exists to the “eight corners”

rule or that this case does not present the right circumstance to recognize any such

exception, AGC-TBB notes that since the filing of the aforementioned Motion for

Rehearing and related briefing, other courts have continued to find that absent a duty to

defend, no duty to indemnify ever can exist. See, e.g., Jenkins v. State & County Mut.

Fire Ins. Co., 2009 WL 1650071, *5 (Tex. App.—Fort Worth June 11, 2009, no pet. h.)

(“Absent a threshold duty to defend, there can be no liability to [the additional insured],

or to the [claimant] derivatively.” (quoting Nat’l Union Fire Ins. Co. v. Crocker, 246

S.W.3d 603, 609 (Tex. 2008)). Such holdings continue to highlight the fact that courts

erroneously interpret the relationship between an insurer’s duty to defend its insured

under Texas “eight corners” rule and an insurer’s duty to indemnify its insured based on

the actual facts. As such, AGC-TBB, in support of D.R. Horton, urges this Court to find

that a determination that no duty to defend exists does not necessarily mean that no duty

to indemnify ever can exist.

PRAYER

Based on the foregoing, AGC-TBB, in support of D.R. Horton, prays that this

Court take this opportunity to clarify that a finding of no duty to defend does not

necessarily preclude a duty to indemnify. Accordingly, AGC-TBB prays that this Court

hold that, even if the extrinsic evidence at issue here is not admissible under the “eight

corners” rule, the evidence can be considered in determining whether a duty to indemnify

exists.

4
Respectfully Submitted,

Lee H. Shidlofsky
Texas Bar No. 24002937
Douglas P. Skelley
Texas Bar No. 24056335
VISSER SHIDLOFSKY LLP
7200 N. Mopac Expy., Suite 430
Austin, Texas 78731
Telephone: (512) 795-0600
Facsimile: (866) 232-8709

-and-

Corbin Van Arsdale
Texas Bar No. 00794776
AGC-TEXAS BUILDING BRANCH
816 Congress Ave., Suite 950
Austin, Texas 78701
(512) 478-5629
(512) 478-1618 (fax)

ATTORNEYS FOR AMICUS CURIAE
ASSOCIATED GENERAL
CONTRACTORS OF AMERICA –
TEXAS BUILDING BRANCH

CERTIFICATE OF SERVICE

This is to certify that on the 17th day of August 2009, I forwarded a true and
correct copy of this Amicus Curiae Brief to those identified below via certified mail,
return receipt requested.

VIA CERTIFIED MAIL #
Robert B. Gilbreath
HAWKINS, PARNELL & THACKSTON, LLP
Highland Park Place
4514 Cole Avenue, Suite 500
Dallas, Texas 75205
Counsel for Petitioner D.R. Horton—Texas, Ltd.

5
VIA CERTIFIED MAIL #
Blake S. Evans
Stephen W. Burnett
SCHUBERT & EVANS, P.C.
900 Jackson Street, Suite 630
Dallas, Texas 75202
Counsel for Petitioner D.R. Horton—Texas, Ltd.

VIA CERTIFIED MAIL #
James M. Tompkins
Les Pickett
Todd F. Newman
GALLOWAY, JOHNSON, TOMPKINS, BURR & SMITH
1301 McKinney Street, Suite 1400
Houston, Texas 77010
Counsel for Respondent Markel International Insurance Co., Ltd.

VIA CERTIFIED MAIL #
Robert A. Shults
Jacob De Leon
MCFALL, SHERWOOD & BREITBEIL
1331 Lamar Street, Suite 1250
Four Houston Center
Houston, Texas 77010
Counsel for Sphere Drake Insurance, Ltd.

Lee H. Shidlofsky